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Closing Bell

News/Business. Maria Bartiromo, Bill Griffeth. A guide through the most important hour of the Wall Street trading day. New. (CC) (Stereo)

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01:00:00

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San Francisco, CA, USA

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Comcast Cable

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Virtual Ch. 58 (CNBC)

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mpeg2video

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ac3

PIXEL WIDTH
704

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480

TOPIC FREQUENCY

Us 22, Cisco 11, Jack Lew 9, S&p 8, Washington 7, U.s. 6, Tanger 6, Comcast 5, John 4, America 4, Mike Rogers 3, Schwab 2, John Harwood 2, Chris Christie 2, Nathan 2, Obama 2, United States 2, J.c. Penney 2, Rick Santelli 2, China 2,
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  CNBC    Closing Bell    News/Business. Maria Bartiromo, Bill Griffeth. A guide  
   through the most important hour of the Wall Street trading day....  

    February 13, 2013
    3:00 - 4:00pm EST  

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>> if this doesn't wreak of romance, i just do not know what does. a valentine's day tour of new york city's biggest sewage treatment plant. this is not a joke. the city says tickets for three-hour tours are nearly sold out and highlights include the giant egg-shaped receptacles. >> thanks for watching "street signs." history always repeats itself. "closing bell" is next. hi, everybody. good afternoon.
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welcome to the "closing bell." i'm maria bartiromo here at the new york stock exchange. stocks mixed at this hour. the dow struggling to stay above the 14,000 level and the nasdaq modestly higher. >> just a reversal. >> i'm bill griffith. we'll see if the dow can rally back. we're at the lows of the day right now but also following these stories on today's ram. the ceo of dow component cisco will be with us. john chambers will join us moments after the company reports earnings. will the results move us closer or further away from a new high? plus a lot more to get into with the always outspoken john chambers. >> he's terrific and how is this for an odd couple. facebook founder and ceo mark zuckerberg having new jersey republican governor chris christie over to his house tonight. >> here's a clue. >> knew you would like that. >> serve lots of food. >> give me a break, bill. >> a live report and we'll explain what's behind this unlikely friendship. >> also. it will be one more day until that carnival cruise ship is
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towed into port. a total tragedy, and now there's a dispute about conditions on board. carnival saying it's fine but passengers saying it's a nightmare. we'll get a firsthand account from the ship. >> let's kick off the final hour of trading. enter the final stretch and the markets are mixed. dow jones industrial average down about 61 points. that's off the worst levels of the day which were hit 15 minutes or so ago. 13,956 the last trade on the blue chip trade. apple was the problem in the nymex yesterday. >> yes, it was. >> s&p 500, dekrein ofcline of point, fractional move. >> let's get into today's market action in our closing bell exchange. nathan bacharach and ed botowski
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along with our own steve liesman and rick santelli. thanks for joining us. nathan, i read you are 50/50 right now, 50% stocks, 50% bonds. why not all in on stocks these days? >> because i've got to live with clients who want to retire, and they want to make sure their money doesn't die before they do, bill. >> all right. right now i'm waiting to see whether or not washington did mess things up which they are very capable of doing. i don't feel as if the sequester is really getting the attention that it deserves right now, and i think that the consumer is waiting to see if in fact we can get through and finish getting the $4 trillion worth of cuts that we need to get done so that everybody will be happy. if we don't do that, i think the consumer is going to go back in their shell and it will look like fourth quarter. if, however, we see washington doesn't screw things up anymore then i think very likely you'll see a nice -- a second quarter that looks a lot like the third
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quarter last year. >> a big bet that you're making. >> steve liesman, separate facts from fiction for us what. will sequestration do to the economy, in your view? what are we expecting to happen if in fact these automatic cuts do happen come march 1? >> no doubt it will be a hit to the economy, and it's a hit that's going to, you know, join with the payroll tax increase that's happened, along with higher gas prices which hopefully given some of the news today we might get a little relief from. i'll tell you that the outlook on this morning's retail sales numbers were sort of really watched with a guarded eye. they weren't too bad. they didn't revise away december's gains, but with those payroll tax increases hitting and the rising gas prices there's concern that there is yet to be a hit to come from the -- from the higher taxes, maria, so join that to reduced federal spending that could help from the sequester. i think that's absolutely right what was said earlier, that
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washington could yet mess up what is a 2% economy. >> ed, what's your thought on that, especially one of the big stories we're following is this currency war to the bottom which seems to benefit equities right now, but, you know, how does that factor into all of this right now, do you think? >> well, it factors quite a bit. you know, really what you're having is a race to the bottom in terms of equities -- excuse me in, terms of currencies. saw venezuela do it. >> right. >> will see more european nation dozen it and obviously japan is doing it, and what that does is it makes our currency worth less so they do it, the countries do it, including our country, to try to make our exports more attractive, and that will help our stock prices basically because there might be more earnings because a lot of our earnings come from outside our borders. that's why we're seeing the devaluation of the currencies. >> does that make you want to buy stocks more. >> i don't know where it ends. no question about it. in fact i'm really surprised that he's 50/50 in terms of his portfolios because i don't know any good reason to not only buy
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a bond right now but to own one because they have all gone up in value but the yield to maturity over the next ten years is very, very small. i advise all my clients to get out of any interest rate sensitive bonds today. not hold on. get out of them. >> i can't afford to play with other people's money, ed. got to live with people long in and long out. >> i think we'll see a trading range here. >> go ahead, nathan. >> what we're going to see is a trading range on bond. every time they go over over 2, they will go back and bounce around for a while. this is not a recovery that will run away and destroy bond value much as we saw in the late 70s. >> is that what you're seeing, rick santelli, in terms of this trading range? >> yes, but there's a couple of caveats. as we move towards lower and lower yields over the last five years, even when they were just under 3 or just under 2, principal appreciation was a driving force.
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those that were in bonds would say, well, i feel safer, but, heck, the price goes up and i don't do badly. it's not just about the rate. after we reach the historic low under 140 there's a bit less of that so even though i do think the best days of rates are behind us, i think the correction is going to be small, maybe 2.25 to 2.50, i don't cede see it on the wild side but to add into everybody's currency argument, there's one other reasons why weakening currencies for indebted nations is good, you get to pay everybody back in cheaper currency. >> rick, we're refinancing all of our debt and doing it at 2%. all of america wishes they could do that. it's going to be great. i'll tell you something. energy costs will it be to go down. we'll become energy self-sufficient and you watch what happens to the cost of manufacturing. i'm going to bet you our manufacturing does well because -- not because our dollar is going to weaken because we'll actually have less expenses going out to energy and that will make us competitive.
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>> but unless the next energy czar the president appoints like the past one thinks maybe put a tax on gas to get it to $10 so the motor mounds for the windmills on chevys works a whole lot better. >> rick, you can bring your blood pressure down. he won't have to do it. we'll have enough cheap energy that we're going to be okay with. >> that really probably the single sort of biggest conversation amongst leaders in davos, that for the u.s., probably the biggest opportunity for actual moving the needle in terms of energy is shale. >> but, maria -- >> that's true. >> dramatic globalismcations in terms of the u.s. current account deficit. if you think about the money we ship now to opec and some of that possibly not being shipped there. >> we're trying to figure out. from the two investors on the panel, nathan and ed. >> yeah. >> how do you buy into the shale story if in fact it is one of
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the single most important things in terms of job creation and growth? >> maria, i'm right down here, maria, in the dallas area where we have the shale. i have personal investments in the barnett shale, we have clients with investments there and one of the great ways to do it is buy an exchange-traded fund that will appreciate as national gas prices do. >> final word here, nathan. >> we'll be pushing so much shale out of ohio that we'll become the next dallas, thank you very much. >> i hope so because you need something good to happen up there. >> i always heard cincinnati was the center of the world, is that right? >> we are. >> i'd be playing north dakota real estate. that's where to put your money. >> all right, guys. sioui later. appreciate your time. >> i think they would be fun at lunch, do you? >> a lot of fun. >> the other big story we're talking today. shares of general electric and comcast, the parent company, both rallying after the cable giant acquired the rest of the
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stake in nbc universal. josh lipton with more on the story. over to you, josh. >> reporter: comcast is saying it will buy the rest of nbc universal and investors cheering that decision. comcast in the green hitting an historic high. now up over 45% in just the past 12 months. a number of analysts increasing their estimates and price targets for come comfort including credit suisse, analysts upgrading comcast to outperform with a price target of 48 bucks. credit suisse telling clients the acquisition gives comcast free access to all the cash flows at nbc universal and believe they are positioned for solid ebitda growth. ge popping within the s&p 500. the industrials the top performing sector, and within the industrials, ge is your top performer as we hit into the close. ge heading a 52-week high today. analysts reminding us that ge has been vocal about wanting to
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return cash to shareholders, and this accelerates the plan to do so. back to you guys. >> not that we're counting josh, the highest level ge has seen in five years, four and a half years. >> it's true. >> but who is counting. >> 50 minutes before the closing bell sounds on wall street, a market down 60 points on the dow jones industrial average. >> when we come back, some banks hitting new highs today, big ones, too. is that group something you want to own right now? we'll look at the banks and where the money is going for the stock market. >> tanger factory outlets shares down despite beating expectations, but the stock is up over 20 over the last year. we'll talk to the ceo and get the state of his business and what that says about the state of the economy with steven tanger. >> dow component results could have a big impact on your investments and tomorrow's trading. we'll bring you an exclusive interview with the man behind the numbers. cisco's chairman and ceo john chambers coming up.
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let's take a look at the big
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group and financial. jpmorgan, goldman sachs, hitting 52-week highs earlier today, so are the banks a buy for 2013 or have we seen the best? we'll do talking numbers and focus on the financial sector etf called the xfl. j.c. o'hara on the technical side and heather hughes on the fundamental side. j.v., let's talk about this. would you prefer buying the financial etf or s&p etf? >> right now, maria, i'm really interested in the financial etf, and the reason being is we have a tremendous long-term base pattern that has formed over the last few years and price right now is breaking to the upside which is extremely bearish. for all you guys who look at the '07 highs to the '09 lows, looking at the 38% retracement level. we move a little bit higher up, these financial could be off to the raises.
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now, do i prefer this over the market as the s&p? i believe so. the next chart i brought along is a longer term chart looking at both the financial compared to the s&p. they have moved lock step at the beginning of the 2,000s. after the financial crisis the s&p actually rebounded ahead -- ahead of the financial sector. right now the financial sector. they were able to clean up their balance cheat and have room to play catchup and i actually like the financials here. >> heather, do you agree? >> i'm not a fobonachi guy, but we have to look at the mortgage applications and the deline in those this morning. over the past four weeks interest rates have started to rise and the banks are the financials certainly get most of their profits from the landing side or the housing side of the banking industry, so at lease levels unless the mortgage supply and demand for such
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continues to increase, it's a little hard to be as bullish in the financial sector. that seems to be the consensus in the retail space. >> i agree with you. >> there are a lot of headwinds facing the financial sector but also a tremendous amount of demand for the individual fundamental stocks. look how the xlf performed versus the rest of the market 10% compared to 18%. the financials have surprised to the upside an average of 14% versus 5% for the rest of the market. >> certainly we've seen new highs today as you stated from stocks like bank of america, a 52-week high since may of '08, but, look, this is due in part from the fed's easing. they are buying 85 billion of these mbss every month, as we know. if and when they withdraw that liquidity prior to the 6.5% unemployment target, then can the banks still have a healthy lending industry to keep them
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propped up? i'm not sure, j.c. >> i guess the question is we know the financials have done so well, but who is to say they will do that well from here on out? >> maria, i'll say this lastly. look at the seasonality. march, april and may are the three best months to be long financials with april being a relative outperformer and in the financial's best month, so we still have some tail winds here pushing us higher into the summer. >> all right. we'll leave it there. we'll be watching that. thanks very much to boast you. appreciate it. >> thank you. >> i guess another question is if the financials don't continue this ride, does that hurt the s&p? >> absolutely. >> is that connected? >> for the last couple of years financials have been a leader in this market. energy and financial, and both are going lower right now, and that's pushing the dow down near the lows of the day. we are down 61 points at this hour. >> let's talk energy. higher taxes and gasoline prices taking a byte out of retail sales. up next, we'll talk with the ceo of tanger outlets on the state of the consumer. >> cue the music.
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yes. talk about an odd couple. facebook ceo mark zuckerberg who hosted president barack obama president obama at a facebook town hall two years ago is holding a big re-election fund-raiser for new jersey's very republican governor chris christie. find out what's behind this new lo lovefest in the democrat stronghold of silicon valley. that's coming up later on the "closing bell." tdd#: 1-800-345-2550 this morning, i'm going to trade in hong kong. tdd#: 1-800-345-2550 after that, it's on to germany. tdd#: 1-800-345-2550 then tonight, i'm trading 9500 miles away in japan. tdd#: 1-800-345-2550 with the new global account from schwab, tdd#: 1-800-345-2550 i hunt down opportunities around the world tdd#: 1-800-345-2550 as if i'm right there. tdd#: 1-800-345-2550 and i'm in total control because i can trade tdd#: 1-800-345-2550 directly online in 12 markets in their local currencies. tdd#: 1-800-345-2550 i use their global research to get an edge.
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the oaks piration of the payroll tax on january 1st, of course, put less money into people's paychecks. that may be affecting retail sales. courtney reagan has the retail movers in today's trading. >> good afternoon, this day flying buy. retail sales increased just 0.1% for the month of january, and as you mentioned payroll taxes are higher. gasoline prices are higher, but you know what, the stock market is doing better, housing is recovering, and you know what, the unemployment rate is getting better, too, so you can see here the retail index has outperformed the benchmark s&p 500 so some retail movers on the announcement today because the broader market didn't move so much. one of the groups that performed data, up 1%, macy's and dillard's under a little bit of pressure, nordstrom and j.c.
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penney trading higher. j.c. penney has increased their buying capacity which is part of the reason for that move and sporting goods, performed better than retail sales numbers. shares moving under a little bit of pressure and cabela's reporting their sales. we'll pay attention to that. and online retail, another area of big, big strength from the report and a continuing from what we saw over the holidays, amazon up sharply but not so much from the retail sales report. more because it announced a content dale with cvs. lots of movers including the retail sales data. >> tanger factory outlets know a little something about retail trends and the shopper. the company owns and operates over 40 outlet shopping centers in 26 states. over 175 million shoppers visit a tanger outlet annually. >> while the company saw a jump in year-end earnings for 2012, that stock has been under pressure today. wondering whether investors are
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concerned that the consumer may not spend as much in 2013. what does tanger ceo have to say about that? we'll ask him. welcome back. >> thanks so much for having me. >> what is your sense of what retail sales will be like this year? are there headwinds for the consumer or not, do you think? >> i think the consumer is getting used to the shock of higher payroll taxes being taken out of their biweekly pay stubs and reassessing their monthly budgets. we've seen this on and off for the past 30 years we've been in business. over time we know consumers love value on brand name and designer name products. in good times people like a bargain and in tough times like these they need one. >> and that's what you're offering, a bargain. >> that's exactly what we're offering, mar aria. >> so talk to us about that. have you seen any change in the behavior of the consumer around
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these uncertain times the last couple of months? >> not really. if you take into account the violent weather that we've had in the last six months, if you take that out of the equation, our traffic still continues to go up. all the feedback we receive on social media, all the different sites is very, very positive. we're looking forward to 2013 being another record year for tanger. >> you know, i was looking at your yield, you know. reits are high-yielding instruments. your yield is 2.4% which sounded low to me and i had our staff look into yields on real estate vimpt trusts and they found the average yield is 1.5% above where yours is right now. why is that?
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>> people invest in tanger looking for a total return on their investment, not just the dividend. last year, for instance, we had a towedal return, including a dividend close to start of where we began today, a total return for our shareholders of close to 14%. if you go back 15 years we've had a compounded total return of close to 18%. that's probably best in class of the 103 or so reits or certainly close to the top so investors look just past the cash dividend and look for total return which includes stock appreciation. >> but there's a whole group of investors that want to invest in companies that pay a dividend and are anticipated to increase the dividend. are you going to increase your dividend this year? >> well, maria, we went public
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close to 20 years ago, may 28th will be 20 years. we are one of only a handful of publicly traded reits that have raised their dividend every year since we've been public. we were one or two or three that raised their dividend. of course, our board makes that decision, but we are hopeful and candidly i'm the largest stakeholder so we're certainly hopeful we'll raise the dividend again this year, and there's a group known as dividend aristocrats which have raised their dividends every year since they have been public with a minimum of 20 years. >> i like that, the aristocrats. >> that is clever. >> and you feel that the real estate market for retail is going to get better? >> well, demand for tanger centers has never been higher. at the end of the year our occupancy was 98.8% which is
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pretty much statistical full occupancy. >> right. >> and i'm also proud to say that for the 32 years that we've been in business we've never ended the year less than 95% occupied. >> let me ask you about the cost of doing business, sir, because the minimum wage issue, of course, was a biggish urk the president calling for a raise to $9. as a business owner, what's your reaction? are you raising minimum wages? >> most of the 45,000 people that work every day in tanger centers around the country, of course, work for our tenant partners. anecdotally, if i were one of the millions of people out of work looking for a job, i would certainly welcome the $7.50 minimum wage versus nothing so it's far above my pay grade to even give you an opinion on whether the minimum wage should be raised or not, but we have to
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create jobs, and it seems that we're starting to creed jobs. >> right. that's not the priority right now is what you're saying. >> i can't even opine on that. i just know that people looking for work would welcome the current minimum wage and be happy to support their families with that minimum wage. >> right. have a job. thanks for joining us on the program. >> appreciate it. >> thank you for joining me. >> he is the second ceo in the last two days i've heard use that phrase, above my pay scale, for a ceo to say that. >> yeah. >> and the other one was much higher paid, too, the one who said that one. >> a market is down 56 on the industrial average. >> war with china. some say a cyber war is already being waged and we're losing. congressman mike rogers heads up the house intelligence committee and explains what needs to be done to protect our national security and our economy coming up. >> technology bellwether and dow
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component cisco set to report earnings after the ball. ceo john chambers joins us exclusively to break down the numbers and tells us what the numbers say about the business and the state of the economy right now. back in a moment. ted the luxuryr and kept turning the page, writing the next chapter for the rx and lexus. this is the pursuit of perfection.
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. the house intelligence committee is holding a key hearing on what some in washington with calling a cyber security war that our nation is involved in and the chairman of that committee says we're losing. eamon javers is in washington with details. >> hi, bill, the obama administration rolled out new details of what it's calling a framework for cyber security cooperation here based on some of what the president talked about in the state of the union last night, and at that event general keith alexander, the head of u.s. cyber command, said it will have to involve a partnership between business and government. take a listen. >> the vets are real and growing. you only have to look at the distributed denial of service attacks that we've seen on wall street, the destructive attacks that we've seen against sawedi ahramco to see what's coming at our nation. we need to act and need to act now. >> now, the reaction to the proposal from the president last
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night for an executive order on cyber security has not been familiar news from the business community, the u.s. shakes telling us they don't like intrusive regulations that will inflict pain on business, financial and otherwise. a couple of other trade organizations today, however, putting out statements much more supportive of what the president said so that's the debate here in washington. >> thanks so much. >> and joining us now is the chairman of the house intelligence committee, congressman mike rogers, congressman from michigan. thanks for joining us on program. >> thanks for having me. >> how much of an impact do you expect the president's executive order to allow defense and intelligence agencies to help develop standards will that be? what kind of impact will it have in stopping cyber attacks? >> yeah. it's a small step and that's okay, but it's an affirmative forward step, so that part is
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good. knowledged in the state of the union that, a, this is a problem, good, and, b, that there needs to be a legislative package passed in order to ensure -- >> yeah, we're having a little problem there with his -- with his feed. are you still there with us, congressman? >> i sure am. can you hear me. >> you were saying two things were good and what's bad? >> so you're going to say i actually probing a camera, thanks. >> you wouldn't be the first, don't worry about it. >> okay. >> is there a downside to the president's suggestion? i mean, we've heard from eamon there that there are some cooperations, the u.s. chamber of commerce, for example, is skeptical of this proposed cooperation between the private sector and the public sector to try and come up with ways to thwart cyber attacks. >> yeah. again, part of the skept sim is
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this notion that they will push standards that by the time the ink dries they will be obsolete. this is a changing problem. it's a problem that will be dealt with in real time at 100 million times a second with 0s and 1s flying at light speed, so it takes a legislative package. the good news is the house passed a bipartisan package last year and we're reintroducing a bipartisan package that has the support of the high-tech community, has the support of wall street, has the support of manufacturers and businesses all across the country, incorporates privacy protections, so we think that this is the bill, and the good news is the white house has said they are willing to work with us as the bill moves through the legislature, and that's a positive sign. i think that's a good thing. >> but it didn't pass the senate last year. have you changed something? do you think it will change in view of the senate this time around, or what's going to happen here, do you think?
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>> yeah. i've been working with the senate, both republicans and democrats, to try to crafting is here. they wanted standards. they were hell bent to get standards which caused the business community, and there was a bit of a backlash so what happened here, the president's eo is dealing in some sense with standards. it's a down payment. it isn't going to have a huge impact, again, a step in the right direction. i think that takes pressure off of the senate so they can actually start to negotiate on this cyber sharing bill that's bipartisan and has passed the house. >> all right. >> how serious is this? i guess characterize for us the problem first because i don't know that people understand the level of hacking, the level of privacy interruptions and upsets that actually go on on a daily basis. what can you tell us? >> yeah, i mean, just think about this, and you can't see it. you can't feel it and you can't really taste it. that's why i think it's out of
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people's minds. think of this, the credit card in your viewer's wallet will get hit 300,000 times a day alone with someone trying to get that information, steal it and use it, so you have all of the criminal level activity from trying to steal your identity, from your own personal money and your credit cards, et cetera, and then you have a nation side -- nation states who are engaged in an unprecedented level of espionage that actually is trying to steal your job. they are stealing intellectual property that's been developed and taking it back primarily to china, repurposing it there and then competing against the company they just stole it from in order to -- to put it as a part of their economy, and that's damaging u.s. jobs and damaging u.s. business. then you have this attack -- >> we're late on stuff. >> if you look at iran -- >> we have a picture of a guy in his bathrobe in a trailer
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somewhere causing the hackings to go on, but we're talking about nation states that can be responsible for this in many cases, don't we? >> oh, absolutely. i mean, chinese, they show up in military uniforms. they are hired and trained by the military, and their job is to get into networks in the united states, steal intellectual property, bring it back and give it back to the so-called commercial sector for them to steal and develop that product, statement there's a new level of attack of what is publicly report as iran. that's now at the shores of the united states. they are not a rational actor when it comes to trying to bring down banks or financial services networks. this is as serious as it gets. it's as big a national security problem as i have ever seen that america is not ready to handle. >> absolutely. >> and that's why it's so important that we get this done. >> very quickly. >> how many times a day do the major banks get hacked? >> well, if one credit card is
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300,000, you can expect it's multiple times of that. >> hundreds and hundreds of thousands. >> attempted to be hacked. >> absolutely. >> good to have you on the program. we appreciate it. >> thanks, thanks for having me. >> congressman mike rogers joining us. really scary stuff. blackberry shares down sharply today. speaking of technology. seema modi at the nasdaq with what's behind that move. >> national bank putting out a bearish note on blackberry, and that's what seems to be weighing on the stock right now. the analyst decreasing his estimates for fc-2015 running the blackberry service model which is blackberry customers for using the company's data network remains a question mark and investors have to understand how that revenue line could potentially decay over the next several years. shares of blackberry are down 10% since its january 30th launch of the blackberry 10
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devices and still up 20% on the year. maria, back to you. >> thanks so much, seema. 20 minutes before the closing bell sounds for the day. down about 57 point on the dow jones industrial average. >> remember how democrats blasted mitt romney for having money sheltered in the cayman islands. treasury secretary nominee jack lew has or did have the same thing. >> why did you choose that investment and what benefits did you receive? >> stick around to hear the answers, plus the rest of his explosive testimony coming up. >> also ahead, president obama calling on congress to raise the minimum wage to $9 an hour. that's up from $7.25. would that slow businesses from hireing? both sides of the debate coming up. stay with us. i know what you're thinking...
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. welcome back. treasury secretary nominee jack lew facing tough questions today about offshore investments he made during the senate confirmation hearing. john harwood with the highlights of the hearing. over to you, john. >> reporter: really the only question of this confirmation
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hearing at the finance committee is what jack lew was going to say about his work at citigroup briefly during the 1990s and his offshore investments, something democrats often have criticized republicans, including mitt romney for. chuck grassly, the senator from iowa, was the main questioner on this topic, and he asked jack lew about his own offshore investment in the cayman islands. >> you invested more money there than the average american makes in an entire year. do you believe the president was accurate in referring to the building which housed your investment as, quote, the largest tax scam in the world? >> senator, i'm happy to answer questions about my own investments. i'm also happy to answer questions about tax policy regarding the sheltering of income from taxation. i reported all income that i earned. i paid all taxes due and very strongly believe we should have tax policies that make it difficult if not impossible to shelter income from taxation.
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>> now senator grassley also question jack lew about the bonus he received from citi at a time when that company was in deep trouble and was about to receive a t.a.r.p. bailout. jack lew said i was in the private sector, was compensated like people in the private sector. i'll leave it to others to judge. if you wonder if any of this imperiled jack lew's nomination, orrin hatch, one of the republicans who want after him today preceded his questioning by saying you've done very well today, jack lew, and we can expect the committee will move jack lew. he'll soon be in office as the treasury secretary, maria. >> john harwood with the latest there. we've -- >> heading towards the close. >> heading to the close. 15 markets left. this market has been steady for the last hour or so with the decline of 55 point. >> the question is the individual investor back in this market. >> when we come back the ceo of put number investments will be joining us and are we heading
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for a correct of some kind? >> and we'll also hear from cisco ceo john chambers moments after the numbers are out and we'll speak with the analysts. [ laughs ] now this is a test drive. whoa! you really feel all 335 foot-pounds of torque. it's chevy truck month! silverado was also recognized for the lowest cost of ownership. hey, what are you gonna do with it? end table. oh. [ male announcer ] it's chevy truck month. now get 0% financing for 60 months,
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waiting for cisco's numbers that will be out in just a minute. jon fortt has a preview of the one number investors need to watch for. what is it? >> a lot of numbers that matter here, but assuming revenue comes in at the 12, 12.1 billion expected, the next place you've got to look is gross margin. last quarter the non-gap number was 62.7% for q2. cisco guide it had slightly lower to between 61 and 62%. here's a tug-of-war with gross margins. cisco services business, which is growing as a share of revenue, pulls margins up, but the company's fast-growing unified computing business is lower and competition is hurt, too. cisco's generally guided to expect 5% to 7% annual revenue growth in normal times and the street is expecting a little less than that this quarter and if gross margins are holding up, that signals cisco still has pricing power. >> thanks so much. i'll be talking exclusively with
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the cisco ceo john chambers moments after the numbers are released. >> listen to this number, more than $10 trillion. that's how much stock market wealth has been generated since the bear market ended in march of 2009. >> a big number. >> a lot of money. many investors were largely signature on the sidelines during that time and missed out on one of the top nine bull markets that we've ever seen. >> as the dow flirts with another all-time high is the individual investors making a comeback. bob jenlds says yes. joins us now to tell us more and why he's a believer. sir, good to have you on the program. >> thank you very much, maria. how are you? >> i'm okay. we've been trying to figure out who is behind this rally. is it institutional money, is it the retail investors coming back. we know we've had a rip-roaring time since the end of last year, what's your take on it and who is buying in this market? >> we've seen the retail investor come back in the market. we started seeing it in
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november. december was the best december in flows we've seen since 2000, and that's carried on through january and into this month, so we think the retail investor is coming back. >> and do you believe the notion that many do you that once the individual investors is getting into the market that it's probably close to a top at that point, that it's too late to invest? what do you think? >> oh, i don't think it's too late to invest. i think america is in great shape. american corporations are in great shape. manufacturing is on the rise in this country. energy costs are going down, so i think the outlook over the next three to five years for american corporations is outstanding really. >> well, it's interesting to note that bill brings up though because this seems to be in the conversation every time we have a market that's moving higher, start looking for the retail investor and there's a notion
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out there that once the retail investors gets more into stocks than, you know, it's about to turn around. you've heard this, of course, with all the other market analogies that you've heard. do you believe that to be true? >> i think we're in the early stages of the retail investor coming back. i mean, they are getting back in the market, but this is after four or five years of being out of the market, so coming back in, yes, they are coming back in but not in droves that would cause you to have concern that they are coming in at the stop. >> i see, i see. >> and you cited a lot of the zions of recovery that we're experiencing in our economy right now, but plenty of bulls who come here to talk to us about why they are buying stocks tell us that they are watching the fed more than they are watching fundamentals, that the quantitative easing, all the liquidity that the fed has provided is the reason that this market goes up. what do you think?
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>> well, i'm watching washington in general. i think, you know, part of this market going up at the end of the year was people having confidence that the fiscal cliff would be addressed. now there was hope for a grand bargain. that never happened, so now we have coming up in early march sequestration, and to me that's a real test to see is this market going to continue, or is it going to take a break here? >> you know, very quickly. are you seeing any evidence that money is coming out of fixed income and going into stocks? >> no really, but it should. i think the risk in fixed income now is so misunderstood by the public it's actually scarey. >> okay. if the market -- if interest rates drop by 1%, the ten-year treasury would drop by over 9 has, and that type of volatility and fixed income market is scary for any investor at this point or should >> you're expecting this trend
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to take place. good to have you on the program. thanks very much. >> thank you, sir. >> see you, maria. see you, bill. >> see you soon. >> bob reynolds of putnam named number one, as a matter of fact. when we come back, the closing countdown and stick around for cisco's earnings for after the bell. >> i love that he's not showing the evidence so that shows the potential for coming into stocks. just ahead, how bad are the conditions aboard the carnival crews line? getting contradicting stories. we'll speak to two people who have relatives aboard the ship. that when we come back. [ male announcer ] any technology not moving forward
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bob will retire when he's 153, which would be fine if bob were a vampire.
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but he's not. ♪ he's an architect with two kids and a mortgage. luckily, he found someone who gave him a fresh perspective on his portfolio. and with some planning and effort, hopefully bob can retire at a more appropriate age. it's not rocket science. it's just common sense. from td ameritrade. welcome back. a quick market flash update and over to josh lipton we go. >> a headline here on best buy. want to bring you up to speed. the best buy founder richard schultz according to dow jones weighing a plan of taking over the struggling chance and lining up investors to take a minority stake in the country, that according to dow jones. schultz, of course, has been working since